IRS chief: No furloughs this year

The head of the Internal Revenue Service said the agency isn’t planning employee any furloughs this year, even though Congress decided not to restore funding to the agency that had been lost due to the across-the-board sequestration cuts.

Congress boosted funding for many agencies in the 2014 spending bill signed by the President earlier this month. But Congress allocated $11.3 billion for the IRS — virtually no change from the amount the agency was left with last year after sequestration lopped more than $500 million from its bottom line.

Even so, in a conference call with reporters Friday, IRS Commissioner John Koskinen said there are currently no plans to furlough employees.

“As I’ve told employees as I go around the country — being an optimist — the good news about our underfunding this year is that very smart people in our CFO’s office contemplated that we might not get much more funding, so we are operating at last year’s level,” he said. “So, we don’t have to find savings to get down to the limited budget, we’re actually there now, which means we have no plans for furloughs.”

While there are no furloughs in the offing this year, Koskinen said the continuing budget crunch means the agency will have to forego “significant improvements,” planned for taxpayer services and compliance activities.

“Given our very limited budget resources, our phone lines are going to be extremely busy and, unfortunately, there will be, frequently, extensive wait times — much longer than we would like,” Koskinen said. He encouraged taxpayers to use online resources to check the status of a refund or to receive prior-year tax returns instead of calling.

All told, the IRS’ budget has declined by nearly a $1 billion since 2010 and staffing levels by about 8,000 positions. Some 3,100 of those positions were in the tax-compliance area — the IRS employees responsible for collecting the taxes that add to the government’s coffers. The Treasury Inspector General, in a report issued last fall, estimated that reductions in the agency’s operating budget contributed to an $8 billion drop in the amount of tax revenue collected by the IRS.

“As I’ve said not totally facetiously — maybe not facetiously at all — I don’t know who got our $500 million but I can guarantee you they’re not going to give you back the $2 billion we would’ve if we had those resources,” Koskinen said.